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Electronic business – the powerful evolution

The "new economy" revolution has not taken place as it seemed for a short moment in history. But the evolutionary development of electronic business has not come to an end. The maturity of e-business increases across sectors and regions, and a new picture of the digital economy is beginning to emerge. IT and electronic business do matter – perhaps more than during the hype of the late 1990s.

The overall economic situation and market conditions for business innovation and investment are still difficult. Nevertheless, electronic business shows a dynamic development in the European Union. Drivers are new technological developments (wireless access technologies, for example) and the increasing competitive pressure on companies in a global economy. Firms are in constant search for opportunities to cut costs. And this is probably the most important promise of electronic business: Increasing the efficiency of business processes, internally and between trading partners in the value chain.

Why focus on sectors?

Results of e-Business W@tch show that the size of a firm and the kind of business activity are the most important factors determining the role of ICT and electronic business. This does not mean that the frequently observed differences in the "e-readiness" of various regions and countries are non existent in the world of business, but they are less pronounced than among households.

Manufacturing companies have different application priorities than those in service sectors, and small enterprises need other solutions than large ones. For example, companies from the automotive or the electronics and electrical machinery sectors have a strong focus on improving the efficiency of their supply chain processes. Enterprises in consumer-oriented service sectors such as tourism or retail are focusing more on customer facing business functions.

E-business and SMEs

e-Business W@tch pays attention in particular to implications of electronic business for small and medium-sized enterprises (SMEs). There are "two sides of the coin": electronic business offers new opportunities for small firms, but also poses new challenges. It will not always be a win-win situation for all stakeholders. As the piece of the cake cannot grow for all, when some enterprises make use of opportunities, it follows that the piece will become smaller for others.

It is the most challenging task of e-business related research to forecast for whom the piece will become larger and who will see his piece getting smaller.